Weekend Cocktail Chatter
To the chagrin of many and the joy of at least a few, Cocktail Chatter
returns after a two-week absence, which God knows I hope made your hearts grow
fonder. Not coincidentally, perhaps, the two weekly recaps that went unwritten
would have had to detail a stock market tumbling steadily downhill, a Net
sector in which investors appeared to have lost all faith, and interest rates
that had reached a two-year high. (Though it's always worth remembering that
6.25 percent is not exactly usurious.) This week, things brightened slightly,
for no obvious reason aside from excellent earnings from bellwethers Cisco (a
holding of mine) and Wal-Mart (which I don't own but probably should) and a
general sense that the market was "oversold."
"Oversold" doesn't mean anything, of course. It just means that prices have
dropped pretty far pretty quickly. Unfortunately, sometimes prices drop far and
quickly for good reasons. This wasn't one of those times, I think, but
"oversold" is not a label that helps you tell the difference. But it's a good
word to use at cocktail parties if you want everyone to know you're in the
know. Actually, it's a good word to use if you want people to think you're a
crackpot. But that can be fun, too. And so, once more into the breach.
1. "This from Bloomberg News: 'Microsoft Corp. said AvantGo Inc., which
delivers customized information to handheld computers, will offer
Microsoft's Slate online magazine in a bid to widen distribution of
the highbrow Web publication ... The push to broaden
Slate's
distribution is part of a sweeping effort by the world's biggest software maker
to strengthen its Internet business and better compete with No. 1 online
service America Online, Inc. ... Microsoft, which is based in Redmond,
Washington, fell 1 5/16 to 83 13/16.' Next we'll be blamed for the fact that
Paul Allen is selling two million Microsoft shares ."
2. "Southwest Airlines president Herb Kelleher announced that he would be
undergoing treatment for prostate cancer , and commentators praised his
openness as evidence that companies were no longer as quick to hide potential
problems from investors. Gerald Meyers, the former chairman of AMC, told the
New York Times , 'It's like erectile dysfunction . Who would talk
about that six months ago?' ... So CEOs are now going to tell us when they're
erectilely dysfunctional? Can we pass on that?"
3. "General American Life Insurance said that it would be unable to
redeem billions of dollars of withdrawals from investors who had entered
into so-called 'short-term funding agreements' with the company. Although
credit-ratings agencies had always frowned on these agreements , General
American always claimed they were a good business to be in. Oh yeah. It's a
great business when you can borrow money with no intention of paying it
back."
4. "The Wall Street Journal reports, as evidence of tight labor
markets , that roofing contractor Jude Laperouse, of Houma, Louisiana, has
to turn down jobs because he can't find enough workers, despite offering a
starting wage of $6 an hour . Damn! He can't get people to work tarring a
roof for $6 an hour? What the hell is wrong with people! How spoiled have we
become?!"
5. "Perennial also-ran Advanced Micro Devices, which practically every year
comes out with a new product that it says will challenge Intel's
domination of the microprocessor market and practically every year has a
new explanation for why the previous year's product failed, released the Athlon
chip this week. It's faster and more powerful than the Pentium III ,
yadda yadda yadda. You gotta wonder if the PR firm that wrote the press release
touting Athlon wasn't tempted to add: 'No, really. This time we mean it.'"
6. "McDonald's is introducing self-serve kiosks in certain test
locations. Someone tell me again: Why did the Automats go out of business?"
7. "Blockbuster Video went public yesterday, and saw its shares budge not
at all from their offering price . The headline in Variety ? 'First
Day of Trading Hardly a Blockbuster.' It's genius, I tell you! Pure
genius!"
